Q: Can you sue an insurance company if they refused to cover costs due to an unethical loophole?
About a year ago, a friend was living in Florida and she lent her truck to a friend. This friend allowed her boyfriend to drive the truck, who had been drinking (but still below the legal limit) and had no driver’s license. The guy got in a car accident and totaled the truck. The insurance company refused to pay anything for the medical bills of the other party involved in the accident or the vehicle. All of this fell on my friend to pay. She had the coverage for allowing other drivers to drive the vehicles, but the insurance company refused to pay because there was alcohol in the driver’s blood (although lower than the legal limit) and he did not have a license. I feel like they found some loophole to get out of paying and what they did is unethical. Does she have any legal-leg to stand on if she tried to sue the insurance company? Would lawyers be willing to work off contingency for this?
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A:
There are no ethical rules for insurance. Read your insurance contract for the exclusions the co. relied upon.
Bad Faith suit is only an extra 25% and exposes you to a bad faith claim. A suit for breach of contract may be possible within the contract term SOL. A good lawyer would not take such a case on a straight contingency.
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